L3Harris Lifts 2026 Earnings Outlook After Record Backlog

The Tip Desk · October 29, 2026 · 3 min read

Orders of $19.3 billion lifted backlog to a record $53.2 billion and the company raised its GAAP EPS range to $12.25–$12.35.

L3Harris Technologies (LHX), the defense electronics and missile maker, posted $19.3 billion of third-quarter orders and lifted its 2026 GAAP earnings outlook after a book-to-bill of 3.2 times, a sharp step-up from the $7.3 billion of orders and 1.2 times book-to-bill in the second quarter.

The order surge took contractual backlog to a record $53.2 billion, from a record $42 billion at the end of the second quarter. Missile Solutions accounted for most of the quarter’s book-to-bill at 11.8 times; Communications & Spectrum Dominance was 1.9 times and Space & Mission Systems was 1.0 times. Space & Mission Systems contractual backlog ended the quarter at $22.3 billion.

The company said it captured a $6.3 billion seven-year undefinitized contract to scale THAAD propulsion production and a $4.7 billion seven-year undefinitized contract for PAC-3 MSE interceptor propulsion, excluding escalations. It also announced a $250 million GMLRS propulsion follow-on, more than $500 million in VAMPIRE C-UAS orders from the United States and allies, and an $876 million Navy Next Generation Jammer Low Band modification. President and CEO Sam Mehta said the priority now is to convert that demand into results, with continued investment in production capacity across missiles and missile solutions, space, resilient communications and multi-domain sensing.

Revenue was $6.1 billion, up 7% from a year earlier and up 9% on an organic basis, after 8% growth in the second quarter. The company attributed the year-over-year increase to double-digit growth in Space & Mission Systems and Missile Solutions. Space & Mission Systems revenue was $3.09 billion, up 10% after 7% growth in the second quarter. Communications & Spectrum Dominance revenue was $2.00 billion, up 3% after 4% growth in the second quarter. Missile Solutions revenue was $1.06 billion, up 5%.

Operating income margin was 13.0%, up 200 basis points from the year-earlier quarter, which the company said was driven by higher revenues and continued management of corporate expenses. Segment operating margin was 15.9%, flat to the year-earlier quarter. Diluted EPS was $3.28, up 33%, which the company said reflected higher volumes, lower corporate expense, lower interest expense and a lower effective tax rate of 14.9%. Space & Mission Systems segment operating margin was 10.9%. Communications & Spectrum Dominance segment operating margin was 25.2%.

Net cash provided by operating activities was $1.4 billion. Capital expenditures were $179 million. Free cash flow was $1.3 billion, up 195% from the year-earlier quarter. The company ended the quarter with $11.0 billion in total debt, $2.5 billion in cash and equivalents and $550 million in short-term investments. It repurchased $73 million of common stock and paid $234 million in dividends in the quarter.

Management increased the bottom end of 2026 revenue guidance to $23.5 billion to $23.7 billion from $23.2 billion to $23.7 billion and raised the GAAP EPS range to $12.25 to $12.35 from $11.80 to $12.00. Full-year free cash flow guidance remains $3 billion. Space & Mission Systems 2026 revenue guidance is now about $11.9 billion, up from about $11.7 billion. Communications & Spectrum Dominance guidance is about $7.9 billion. Missile Solutions guidance is unchanged at about $4.1 billion.